Lessons from a Vandy Football GameThis weekend my eldest son turned six years old.  What right of passage does every six-year-old boy celebrate in the South?  He goes to a SEC football game.  And so we set out on Saturday evening for a little "guy time" with the Vanderbilt Commodores, hot dogs, nachos and popcorn.  My son was decked out in his new blue polo shirt sent from his O’Ma, while I had on my favorite red, slim-fitting AGC golf shirt.  The problem is … Vandy’s colors are black and gold!  Which means that you are summoned … ordered … required … mandated … dictated … to wear either black or gold!  My lack of knowledge did not excuse my non-compliance with the black and gold ritual.  Imagine being the only person in the entire stadium with a red shirt.

If you are a federal contractor, don’t be the only person with a red shirt.  Effective today, contractors and subcontractors will be required to use the E-Verify system to verify their employees’ eligibility to work in the United States. In the past, the government attempted to mandate the use of E-Verify, the web based system that employers can use to confirm the legal status of their employees. The proposed law was set to take effect in January of 2009. However, the legislation instigated much debate and several controversial provisions kept it from taking effect.

Although the amended proposal which takes effect today has significantly less bite, E-Verify has broadened in scope. Not only do the provisions apply to contractors and subcontractors on federal projects, but also to any business receiving funds under the federal stimulus project. For more details about E-Verify and some of the hot issues surrounding its controversial history, check out some of the following sites:

Given the current state of the economy, more and more contractors are taking on public projects. For this reason, all contractors and subcontractors would be well advised to prepare for compliance with the mandated use of E-Verify.  Don’t be the only one wearing a red shirt.

Budgets are being cut left and right.  Our family "eating out" budget … gone!  Our community organization "summer party" budget … gone!  I see non-profit organizations struggling to keep pace with last year’s donations, while attendance at professional industry conferences are shrinking.

Construction Industry Rebound? Is that a Bull?

You can imagine my surprise when I read a press release from CADD Microsystems suggesting that the construction industry is showing signs of rebounding.  CADD Microsystems, an Autodesk solutions provider, sponsored a conference called Tech Tour in Washington, D.C. last week.  CADD Microsystems reports that it had more than 200 attendees at the conference:

"This Tech Tour was one of the largest events our company has ever hosted," said Jeff Gravatte, CEO of CADD Microsystems, "and we are pleased with what that says about the state of the design and building industry. To have more than 200 people spend a day learning the latest trends in BIM and design technology speaks volumes about the strength of the building industry and its promise for a speedy recovery."

Perhaps this is simply a case where the title of the press release ("Indications of Building Industry Rebounding as More Than 200 Design and Construction Professionals Attend Building Design Software Event") promises more than is being served.  I have seen the monthly reports from Southeast Construction about drying up construction markets and the AGC about the continuing decline in construction jobs.  Don’t get me wrong … I would love to see a turn-around in this economy. 

The more noteworthy report from CADD Microsystems is the briefing offered to Congress, organized by the High-Performance Buildings Congressional Caucus Coalition and the National Institute of Building Sciences. The briefing on BIM and high performance buildings took place earlier this week on Capitol Hill and focused on the importance of technology in the building industry:

Building Information Modeling is focused on eliminating significant amounts of redundant and wasted effort currently embedded in the design, construction, and operations of facilities due to the lack of software interoperability. The beneficiaries of this information range from the designers and construction contractors to facility operations and sustainment all the way through the building life cycle.

Lessons Learned? Perhaps the large reported attendance at the Tech Tour is something other than an economic rebound−perhaps it is an indication that industry professionals have more "marketing and development" time on their hands to attend conferences.  It provides them with an opportunity to learn about the strengths of new technologies (i.e., Building Information Modeling), as well as, a venue to develop new business relationships.

There has been a lot of talk recently about measuring a green building’s performance after construction has been completed.  Last week, I highlighted what the United States Green Building Council (USGBC) had to say about the issue.  On Monday, Mireya Navarro of the New York Times wrote a lengthy article about green buildings not living up to their performance expectations.

Almost immediately, green voices across the internet have shared their critiques and criticisms of Navarro’s article.  For example, Preston Koener at Jetson Green comments: "Navarro’s not breaking any new ground here, especially for those ensconced in the green building world; however, like the ingredients of a hot dog, the general population needs to understand what LEED is made of."  Koener continues his assessment by describing the LEED process and the distinctions between design, construction and operation.  An excellent read!

On the more critical side, Lloyd Alter at Tree Hugger cuts to the chase … suggesting that the New York Times is "behind the times" and "distorts" the LEED energy performance issues.  According to Alter, the NYT article "stretches the point" by highlighting an older building designed and constructed under outdated LEED standards.

What do I think?  I think we need to look at another player in this scenario … the Green Building Certification Institute (GBCI) … which is the entity responsible for project certification and professional credentials.  On its website, GBCI summarizes the LEED 2009 Minimum Program Requirements (MPRs).  I previously reviewed the "revocation" language in the MPRs and the commentary from many of the industry players. But you should look at the actual language of MPR #6, which states that the building owner must commit to sharing whole-building energy and water usage data:

All certified projects must commit to sharing with USGBC and/or GBCI all available actual whole-project energy and water usage data for a period of at least 5 years. 

This period starts on the date that the LEED project begins typical physical    occupancy if certifying under New Construction, Core & Shell, Schools, or Commercial Interiors, or the date that the building is awarded certification if certifying under Existing Buildings: Operations & Maintenance. Sharing this data includes supplying information on a regular basis in a free, accessible, and secure online tool or, if necessary, taking any action to authorize the collection of information directly from service or utility providers. This commitment must carry forward if the building or space changes ownership or lessee.

GBCI still reports that the LEED 2009 Supplemental Guide is expected to published in summer 2009, which by my calendar has already passed. Has anyone seen a copy of this guide yet?

Now you may understand why there are so many divergent green voices out there: from Navarro to Koener to Alter.  First, there was a desire to design and construct a green building that achieved certain energy efficiency standards.  Then, there was trophy (i.e., certification) awarded to the building owner for excellence in the design and construction of such a sustainable project.  Now, there is a warning from the trophy giver that the "certification may be revoked" for "non-compliance" with any applicable standard.  However, that applicable standard (as it reads now) is merely a "commitment" from the owner to provide certain energy performance information.  That standard is not an actual achievement energy savings.  Let’s hope the trophy giver can clarify the issue through its new Building Performance Initiative.

When discussing the short and long term building performance of a green project, the issue generally comes down to the following question: Is there any identifiable or measurable gap between the predicted building performance (in the design and construction phases) and the actual bulding performance (during occupancy, operation and maintenance)?  This issue has been addressed in part by a number of my colleagues, including Stephen Del Percio ("Energy Performance in LEED Buildings: A History") and Chris Cheatham ("Real Life Example of the Energy Performance Gap").

USGBC Ready to Rumble?

Yesterday, I saw the following following press release: USGBC Tackles Building Performance Head On.  The USGBC announced the Building Performance Initiative, which is intended to assist LEED building owners and project teams to close the gap between predicted performance and actual performance.  The new initiative seeks to tackle building performance by the following:

  1. Employ a comprehensive data collection effort from all buildings that have acheived LEED certification;
  2. Implement an appropriate method to analyze the data collected; and
  3. Provide feedback to building owners.

There will be four summits held across the country in September and October to preview the proposed data collection and data analysis methods.  "The local summits are a way to gather people’s input for our vision and also for them to share their performance stories, successes and challenges," said USGBC LEED Senior Vice President, Scot Horst.

Although USGBC says that it is ready to rumble by tackling building performance head on, it will be interesting to see some of the ideas previewed in these summits.  Already, we have heard from numerous industry players about the proposed enforcement tactic of revocation.  One of the more significant unknowns is determining whether LEED certification (based upon design and construction) should be separate from building performance (based upon actual assessment). In other words, will USGBC have a multi-tier certification for design/construction and performance? Will USGBC have a conditional certification based upon predicted performance? Will USGBC extend the certification process to include building performance? The USGBC better be ready to rumble!

Photo: Wade

What does a little game of tag have to do with construction contracts?  If you ever come by my house on a Saturday afternoon, you will find about 10-15 kids running through my backyard playing the "You’re it!" sensation.  Oftentimes, when I am sitting on the back deck with a cool glass of iced tea, one of these runts will run right towards me in hopes of finding assylum in my presence.  Reaching out to touch my arm, the kid yells: "HOME BASE!!!"

"How did I become home base?" I ask myself.  If you don’t know what I am talking about, home base in this childhood game is a safe haven … a resting area … a zone of protection.  I delight in the idea of being a "home base" to any one of these kids. Fun times.

The little game of tag came to mind last week when I was reviewing a construction contract, which included a new clause that I had never seen before.  It read something like this:

Subcontractor hereby waives the protection of the automatic stay provisions under federal bankruptcy laws, 11 U.S.C. section 362, or any other similar stay provisions under any present or future state or federal law relating to bankruptcy or insolvency.

Wow!  That cannot be enforceable, can it?  What’s the point of home base … the automatic stay of litigation that is guaranteed by filing for bankrupty protection … if you can waive it?  Certainly, the bankruptcy courts do not appreciate their jurisdiction and powers being waived.  Right?

Is a waiver of Wrong. The issue is not so simple.  Courts have treated pre-petition waivers differently and inconsistently throughout the country.  The courts generally fall into the following categories:

  1. Those jurisdictions where pre-petition waivers are enforceable, whether on public policy grounds or freedom of contract grounds.
  2. Those jurisdictions where pre-petition waivers are unenforceable, as against a statutory policy or to protect other creditors.
  3. Those jurisdiction where pre-petition waivers are viewed on a case-by-case basis.

If you understand the purpose of the automatic stay, then you understand why there might be divergent views from the courts.  The waiver of automatic stay provision should not be confused with a blanket prohibition against filing for bankruptcy, which would not be enforceable.  In other words, the automatic stay is not to provide an absolution of liability, but rather to "stay" the litigation of claims that exist outstide the bankruptcy court.  The "stay" … or home base … gives the debtor, the creditors, the trustee and the court a resting area to begin, assess, and analyze the restructuring process.  

<8/26/09> Update: I have received a number of inquiries about the case law supporting the various approaches above.  For an good review of the law, see Michael L. Bernstein’s article for the American Bankruptcy Insitute entitled, "Enforceability of Prepetition Waivers of the Automatic Stay."

A few weeks ago I tweeted about the local building code in Nashville "under review."  Actually, those words were a little weak.  What about these words: "Contractor Leads Attack Against Nashville’s LEED Legislation" … the exact words used by my colleague Stephen Del Percio, attorney and author of Green Real Estate Law Journal.  A good analysis by Steve!  

The original article by Michael Cass in The Tennessean highlights a local contractor’s frustration with the LEED requirements on a school project.  However, Councilman Duane Dominy, sponsor of the bill, said he didn’t write the legislation specifically to help the contractor and isn’t trying to "do away with LEED." 

According to the title of the legislation at issue (BL2009-503), the bill seeks "to allow an alternative to LEED certification based upon lowered measured energy use."  The legislation was introduced on July 21, 2009 and passed its first reading. The bill was then referred to the Codes Committee. It was scheduled for three votes on August 6, 2009, but was "deferred" for a later time.

Importantly, the preamble contains a statement that any alternative should be allowed "provided the alternative system will result in actual lower measured energy use."  There are many signficant highlights of the proposal, including the following:

  • it allows for a city-wide approval of an alternative to LEED certification;
  • it requires "actual lower measured energy use" for an alternative system
  • it requires the governing authority (Metro Goverment) to approve a certified or duly recognized "business energy professional" to monitor the energy use 12-18 months after substantial completion

Finally, here are the two kickers:

D. If the energy use objectives are not met, the pre-determined entity responsible for the warranty shall reimburse the Metropolitan Government for excess energy use costs for any year of the warranty period based on the energy rate costs prevailing during the first year of the warranty period. The entity responsible for the warranty shall provide the Metropolitan Government an irrevocable warranty surety.

E. No warranty penalty or reimbursement shall be applicable if the Metropolitan Government significantly changes the function of the facility beyond what was originally authorized by the final use and occupancy permit.

A couple of thoughts on this new legislation: First, it will be interesting to see whether a surety will step up to the plate with an irrevocable warranty.  I cannot imagine the difference in energy costs savings and losses would be so significant so as to place the risk beyond insurability. 

Second, there remains a carve-out in the event that the owner changes the function of the building beyond what was anticipated.  In other words, there appears to be a less stringent standard … or no penalty … for major rennovations that perhaps change the function of the building.

Finally, the legislation demonstrates that there is, and will continue to be, tension between the LEED rating system and alternative rating systems, particularly as local and state jurisdictions become more green-saavy in their understanding of sustainable design, energy performance, and longterm investment strategies.

In July 2009, Wisconsin (through its Division of State Facilities) became the first state to require BIM on large public projects.  The details were highlighted in a previous post.

Yesterday, the Texas Facilities Commission (TFC) announced its adoption of BIM for state design and construction projects.  The state has diligently worked to standardize the use of BIM for its future projects.  According to TFC Executive Director Edward L. Johnson, Texas wants to be a leader in BIM: 

“Modernization of our business practices, modernization of our real estate strategy, modernizing building design and construction . . . a part of everything we do is making use of the most innovative, state-of-the-art developments in both the public and private sector. Three years ago we embarked on making the Texas Facilities Commission the most sophisticated and professional real estate management and building design and construction organization that exists in the public sector. Becoming a leader in Building Information Modeling is an important step in that direction.”

The TFC does not  jump on the BIM band wagon and simply issue a press release touting its use of BIM … their actions speak louder than words.  For example, TFC is committed to developing clear standards and guidelines for the private participants, as well as an interoperable BIM template.  TFC produced a video that highlights its adoption of new techologies and commitment to BIM:

https://youtube.com/watch?v=SJDeFT5em7M%26hl%3Den%26fs%3D1

For more information about TFC’s new BIM program, check the TFC website or contact Mike Blackwell, TFC Marketing and Communications Specialist, at Michael.blackwell@tfc.state.tx.us

Letter from My Belts

After an extra long day at work, it is easy to come home … take off my tie and belt and shoes … pile them in the corner … and collapse on the couch for a few moments of rest.  For many years, I would leave my things piled in that dining room corner and I would usually pick my belt in the morning while on the way out the door.  

One day, my belts had a different plan.  As I was preparing for an early morning meeting, I raced down stairs, knowing that there were at least two belts in my usual corner (… he-he .. I left them there two nights in a row … ).  Rather than finding my belts, however, I found this ( —-> ) note.  I was surprised at how similar the handwriting was to that of my wife.  Nonetheless, I can’t blame my belts for running away.  They have asked many times to be put away at the end of a long day.  I did not listen.  I did not learn. 

Are you listening to your belts projects?  Are you learning from your belts projects? You should be.

One project management tip is to create a "Lessons Learned" process that results in the identification of issues for improved design, construction or performance on subsequent projects.  In other words, "Lessons Learned" is the formalized approach to gathering information both during and after construction which can be used to assist future project teams based upon the written experiences and recommendations. 

What does "Lessons Learned" look like on a green building project?  Harvard’s Green Building Resource provides an excellent example in a case study on the One Western Avenue project: 

  • One Western Avenue was denied EQc4.3 for not providing carpet cut sheets. From the specifications, it was not clear which product was used. Be sure to include cut sheets for all EQc4 projects."

"Lessons Learned" can also be more detail oriented and created as part of a final submittal process, such as the Final Construction Deliverable prepared by Extrusion Technology, Inc. for a renewable energy project in Massachusetts.  You can even find basic "Lessons Learned" templates on-line.

Writing the lesson learned, however, is only the start.  The real commitment by project team members is to have the resource readily available for the next project and to act upon those recommendations.  I’ve learned my lesson and my belts have not run away ever since.

I know that title sounds odd. Before you start flooding my email box with comments about the practicality of Building Information Modeling (BIM) or the utility of social networking like Twitter, Facebook or LinkedIn in the construction industry, consider the life of the personal computer:

Were you around in the 1980s during the microcomputer wars between Commodore, Apple, Atari and Tandy? Can you believe that some of the first personal computers once plugged into a standard television that acted as the monitor?  It’s so hard for me to even imagine that the little IBM ThinkPad that I pound my fat fingers on every day once looked like this? 

Even when I view the practice of law over the past 20 years, I see the dramatic changes that technology has brought. The legal brief is no longer typed on an IBM Selectric with carbon copy sheets and sent to court via courier—it is drafted on a laptop, converted to an Adobe .pdf document, and electronically filed with the court.  The letter to opposing counsel is no longer dictated to a secretary who takes down every word in shorthand—the words are spoken into a digital handheld device, which is connected to a laptop computer that transcribes the entire letter using voice recognition software.  

Given the transformation of how these simple tasks have been performed over the past two decades, it does not seem that far fetched to believe that technology can help sustain or revive a construction company in the years that follow this recession.  Just read what Geoff Smith, Chief Executive for EllisDon told to Reed Construction Data about the livelihood of the construction industry in the post-recession recovery period:

Turning his focus to new technologies, Smith said that Building Information Modeling (BIM) is the way of the future, adding that those contractors who don’t adopt it will be left behind.

“If you don’t (embrace BIM), you’re not going to make it down the road,” he said. “It’ll take a little while to take hold, because it requires some upfront investment on the part of the clients and the builders. But it’s coming everybody has got to embrace it as soon as they can find a way to.”

The same applies to social networking, which Smith has embraced — he’s on Twitter, Facebook and he blogs.  Social media is a key element of the company’s forward-looking strategy, he said.

“The construction industry over past generations has always been about people — we sell people; we put people on a project.

“Now there is the opportunity and the means to sell knowledge, intellectual capital and to create a competitive advantage doing that — and we see the social media facilitating that and creating that opportunity.”

I have written about the future of BIM being "in the pipeline." I have said that mainstream acceptance of BIM is a question of when … not if.  When I take a step back and look at an industry’s acceptance of a particular technology (i.e., the law firm’s use of laptops, electronic filing, digital dictation devices, Blackberries, etc.), it is not difficult to understand and agree with Smith’s comments about BIM and social media.

The more difficult exercise is to crystal-ball the issue of defining when a particular technology becomes universally accepted … of trying to pinpoint when everyone (…or almost everyone…) will use the laptop, cell phone, DVR, iPhone, or even BIM.  But as an advocate of technology, perhaps our job is not to predict … it is to advance, build up, campaign, encourage and support.

Which is worse: (a) one lawyer in a room of one hundred architects; or (b) one architect in a room of one hundred lawyers? 

Two weeks ago I found myself in the first category (… although I’m sure that I was not the only shark in the room …) at a local United States Green Building Council (USGBC) meeting that featured the "2009 Top Ten Green Projects" awarded by the American Institute of Architect (AIA) Committee on the Environment (COTE). In case you don’t know, every year COTE highlights the top green projects based upon the measures of sustainable design.  According to COTE, "Sustainability envisions the enduring prosperity of all living things … [and] … [s]ustainable design seeks to create communities, buildings, and products that contribute to this vision."  The measures of sustainable design include, among others, design and innovation, land use & site ecology, materials & construction, and energy flows & energy future.

The "Top Ten" from 2009 may be old news to many of you.  However, it is worth mentioning here because of the AIA / USGBC comparison that was highlighted in the 2009 presentation:

As you can see, the COTE Top Ten Measures go a few steps beyond the LEED rating system.  According to the speakers a few weeks ago, Henry Siegel and Kim Shinn (both were judges on the 2009 Top Ten panel), the COTE measures include both quantitative and qualitative measures (or "intangibles").  In the presentation above, the measures highlighted in yellow on the left are those areas not fully addressed by USGBC’s LEED rating system. 

(… DON’T JUMP THE GUN, USGBC!… I am not done yet…)  This presentation was based upon the LEED v 2.2 criteria … and not LEED 2009, which now addresses some of those areas included in COTE’s Top Ten Measures (i.e., regional credits, future energy performance).  For the green-building newbie, the Top Ten Green Projects is a good starting point for seeing various sustainable measures carried out in actual building projects … with cool pictures, too!

[NOTE: The full presentation can be found on AIA-COTE’s website … about halfway down on the left.]

UPDATE (8-1-09): Thanks to Michael at www.buildinggreen.com, who pointed out that Henry Siegel is past chair of AIA COTE and is currently a committee member. He was not a judge on the panel this year.